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This morning management's commentary will cover our financial and operating results for the first quarter, and the investment environment. John, Scott, and I will provide the prepared remarks. Steve Dominiak will be available during the question-and-answer period.

We are pleased with our first quarter results as our financial and operating result came hence through the high-end of our expectations. Reported FFO per share totaled $0.57 compared with the range we provided at the start of the year of $0.54 to $0.56. The $0.02 variance from the midpoint was driven primarily by property-level expense saving from a mild west coast winter, and G&A expense at the low-end of expectation.

We continue to see very healthy revenue growth across the majority of our portfolio. Year-over-year first quarter same-store revenue increased 5.8% and increased over the fourth quarter pay of 5.5%. The San Francisco Bay Area and Seattle remain our strongest market. In Southern California, Los Angeles is our strongest market, and Orange County is positioned for stronger growth as we enter the prime-leasing sequence. San Diego remains our most challenged market and reflects the Tale of Two Cities, with the Northern half of the city much stronger than the Southern portion, which has been impacted by military troop rotation.

The big four drivers of our drivers of apartment were demographic, supply, propensity to rent and job growth continue to support the demand for multi-family both at the property level and at the rate level.

Multi-family construction activity is increasing in several of our
market albeit still below peak level. Seattle and San Jose will see a noticeable increase in deliveries over the next 12 to 24 months. And while there maybe pockets of supply as these properties lease up, both of these markets have some of the strongest job and more importantly, wage growth in the country, which will support the absorption of new products in these markets.

Rent-to-own gaps
remained very wide in the Bay Area and Orange County at $500 to $600 a month.

While the gaps have compressed a bit in L.A., San Diego and Seattle, we are not losing a significant number of residents to home purchases. Across the portfolio, move-outs to home purchases were 10.3%, slightly lower than prior year’s pace at 10.5%. L.A. move-outs to home purchases were only at 8.1% and Orange County was even lower at 6.7%. Seattle represents our market with the highest move-outs at 12.8%, that’s still below average for this market.

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